ZOMG, Joo!!! -- Psualum Forum

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Subject: ZOMG, Joo!!!

Author:
Heaves

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Date Posted: 14:47:40 05/07/12 Mon

Our current monthly mortgage and HOA fee is roughly $3000. He will be paying rent at $2900 a month, ours to keep free and clear. Rent does not increase.

Our current listing is $550K. He is able to buy in a year at 555, two yeas a 560 and three years at 565. There will be appreciation, I'm nearly certain of that, and it will likely appreciate more than what we are asking for. If not, then I guess it will be within our right to re-price it if he can't secure a loan at the corresponding price. However, from a contract perspective, we won't have to. Even so, if he lives in the house for 10 years he will have no problem making his money back and then some. The county is building up the area with more shops and local jobs, and the area will be a boom town.

He is giving us 9000 down. He gets this back as a down payment for the house if he converts the property successfully within 3 years. We get to keep this if he doesn't.

In addition to paying rent, he will be giving us $150 a month that goes towards the down payment of the house. Same thing as above though, he doesn't get this back if he can't secure a loan in 3 years.

These provisions are made to mitigate the risk of the event that he doesn't buy the property. We will undoubtedly have to use a realtor next time because we will be abroad, and we need a safety net to cover this cost. The reason he can't get a loan now is that he just went though a divorce and his wife cleaned house. I am assuming this because he brought a woman to the house that wasn't his wife! I am waiting for his financial info to do a background check.

As far as his intelligence, he seems like he's doing the right thing to me :)

Here's an article on how these agreements typically work. You will find that we follow protocol.

http://home.howstuffworks.com/real-estate/rent-to-own-homes.htm

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